Bay Area Nonprofits Hit Hard by Recession, Survey Finds

June 1, 2009

According to a new survey by the United Way of the Bay Area, one-third of Bay Area nonprofits are worried they may have to shut their doors by the end of the year, while 34 percent report they have two or fewer months of operating expenses in reserve.

According to UWBA's 2009 Nonprofit Pulse Survey, which was conducted between April 14 and April 27, 64 percent of local nonprofits reported increased demand for their services, 31 percent of nonprofits had expanded services to meet growing demand, 26 percent had collaborated with another nonprofit over the past six months to provide additional services, and 23 percent had been forced to cut services. The survey also found that 48 percent of nonprofits have tapped their reserve funds in the past year, including 15 percent that have used up more than half their reserves. In addition, two area organizations have merged in the past six months, while fourteen are considering a merger in the near future.

The survey revealed the extent to which nonprofits have adopted cost-cutting measures and anticipate more belt-tightening measures in the coming months. More than three-quarters of respondents expect demand for services to increase in 2009, with 45 percent expecting a significant increase. At the same time, 20 percent have laid off staff in the past six months, and of those organizations, 37 percent are considering additional layoffs. In addition, another 25 percent have cut staff hours, and of those 30 percent are considering layoffs, while 59 percent may reduce staff hours further in the next six months.

"While the findings from our survey are sobering, they motivate us to work even harder to find the most efficient and effective ways to serve our community," said United Way of the Bay Area CEO Anne Wilson. "Nonprofits are working together more creatively and collaboratively, as we are increasingly called upon to do more with less. This renewed energy around collaboration and partnership might be one positive emerging from these lean times."